Bulls Want a Taste of Surging Skyworks Solutions, Inc. (SWKS)

Skyworks Solutions Inc (SWKS) is getting a halo lift from Apple Inc. (AAPL)

Digital Content Group
Jan 28, 2015 at 11:38 AM
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Skyworks Solutions Inc (NASDAQ:SWKS) touched an all-time high of $83.95 earlier, and was last seen up 1.5% at $82.74 -- thanks to a halo lift from Apple Inc. (NASDAQ:AAPL), as the company serves as a supplier for the iPhone maker. Accordingly, call buying has picked up, with the intraday pace at twice that of normal levels.

Today's most popular option is the March 85 call, with data suggesting buy-to-open activity. These traders expect SWKS to extend its long-term rally and surpass $85 by the close on Friday, March 20, when the contracts expire. Another strike seeing notable attention is the February 82 call. However, it looks like sell-to-close activity could be occurring here, likely due to traders taking profits off the table after today's price jump.

Put buying has actually been the norm in the security's options pits. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 50-day put/call volume ratio of 0.37 is higher than 98% of all readings taken in the past year. However, considering SWKS has nearly tripled in value in the past 52 weeks, this put buying could likely be due to shareholders hedging against any downside.

It's also not surprising, then, to see the analyst community take an overwhelmingly bullish stance toward Skyworks Solutions Inc (NASDAQ:SWKS). Of the 14 brokerage firms covering the equity, 12 rate it a "strong buy."

 

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